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30 May 2022

Hungary throws sand in the gears of an EU oil embargo

As European leaders meet in Brussels, Viktor Orbán continues to oppose the bloc’s plan to further sanction Russian energy imports.

By Ido Vock

EU leaders meet in Brussels today and tomorrow amid a fresh attempt to agree a package of sanctions on Russia including an embargo on imports of oil from the country. The so-called sixth package has been stalled for weeks because of opposition from Hungary, by some distance the most pro-Russia EU member state. 

EU officials have been devising a plan which would ban imports of oil delivered by tanker while allowing imports via pipeline to countries including Hungary and the Czech Republic. These are supplied largely via the Soviet-era Druzhba pipeline, which runs through Ukraine. Such a move would cut off imports of about two-thirds of Russian oil entering the bloc, but even that compromise failed to reach agreement an on 29 May. Some countries are also worried that a ban on seaborne imports would unfairly advantage member states such as Germany and Poland which are not in danger of energy shortages. 

A failure to agree on the oil embargo means that other measures in the sixth sanctions package have not been implemented, such as further restrictions on Sberbank and other Russian banks and asset freezes on Russian officials. The EU pays Russia around €1bn every day for energy, particularly of oil and gas. 

Other member states also heavily reliant on Russian oil are quietly reassured by Hungary’s opposition, however, a potential indication of fracturing Western unity over how much to support Ukraine in the face of record inflation and rising food prices. Hungary may be the most vocal opponent of an embargo but states across the EU, from Bulgaria to Slovakia, are heavily dependent on imports of oil from Russia. Untying decades of interdependence may be politically necessary but it is not easy to implement within weeks, especially as voters begin to feel the effects of a growing cost-of-living crisis, posing a more immediate political threat to European leaders than the war. 

[See also: Viktor Orbán is using the war in Ukraine to entrench his own power]

The German Chancellor, Olaf Scholz, has come in for hefty criticism for Berlin’s reluctance to make good on its promise of a Zeitenwende (change in the times). The governing coalition and the centre-right opposition, the CDU/CSU, did agree on 29 May to increase military spending by €100bn. However, Die Welt, a conservative German newspaper, reported that Ukraine has only received two shipments of weapons from Germany since March, and Scholz has refused to supply German tanks and armoured personnel carriers to Kyiv.

Hungary may be the chief holdout preventing an oil embargo but its obstructiveness is by no means the only instance of division within the Western alliance on how far support for Ukraine should extend.

[See also: Putin thinks he’s called the EU’s bluff – and he may be right]
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